FTSE drops as US consumer sentiment disappoints

The FTSE 100 and Dow Jones industrial average have extended losses following a closely watched survery out of the US indicating consumer sentiment in the world's largest economy is at its lowest level since March.

The FTSE 100 is down 33.32 points, or 0.7%, at 4722.1 at 3.05pm UK time. It was down just a few points before the 2.55pm data.

The Reuters/University of Michigan Surveys of Consumers said its preliminary reading of the index of confidence for August fell to 63.2 from 66.0 in July - well below economists' forecasts for 68.5, according to a Reuters poll.

The Dow Jones sold off following the news to be down more than 1% at 9296.9.

The FTSE had started the day on track to clock up a fresh 10-month peak, having closed at its highest since October on Thursday when positive economic data frojm Germany and France cheered investors.

The index pared gains after US inflation data came in as expected this afternoon. US industrial production data, also out this afternoon, beat expectations, rising 0.5% in July.

But the FTSE 100 slipped into the red when bad news from Boeing dragged the Dow Jones lower and frayed investor nerves as they braced for the consumer sentiment data.

Boeing shares fell after it said an Italian supplier stopped production in June on two sections of its long-delayed 787 Dreamliner after structural flaws were found on fuselages.